AerCap Holdings N.V. AerCap Holdings N.V. Fourth Quarter and Full - - PowerPoint PPT Presentation

February 28, 2007 February 28, 2007

Fourth Quarter and Full Year 2006 Fourth Quarter and Full Year 2006 Earnings Call Earnings Call

AerCap Holdings N.V. AerCap Holdings N.V.

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Forward Looking Statements & Safe Harbor Forward Looking Statements & Safe Harbor

This presentation contains certain statements, estimates and forecasts with respect to future performance and events. These statements, estimates and forecasts are “forward-looking statements”. In some cases, forward-looking statements can be identified by the use of forward- looking terminology such as “may,” “might,” “will," “should,” “expect,” “plan,” “intend,” “estimate,” “anticipate,” “believe,” “predict,” “potential” or “continue” or the negatives thereof or variations thereon or similar terminology. All statements other than statements of historical fact included in this presentation are forward-looking statements and are based on various underlying assumptions and expectations and are subject to known and unknown risks, uncertainties and assumptions, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on

• ur current expectations and projections about future events. There are important factors that

could cause our actual results, level of activity performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied in the forward-looking statements. As a result, there can be no assurance that the forward-looking statements included in this presentation will prove to be accurate or correct. In light of these risks, uncertainties and assumptions, the future performance or events described in the forward-looking statements in this presentation might not occur. Accordingly, you should not rely upon forward- looking statements as a prediction of actual results and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. We do not undertake any obligation to, and will not, update any forward-looking statements, whether as a result of new information, future events

• r otherwise.

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2006 Highlights 2006 Highlights

Q4 net income was $41.5 million (excluding charge for share based compensation) FY net income $156.3 million (excluding charge for share based compensation) FY revenue was $814.4 million (up 65%) Flight equipment held for lease was $3.0 billion as of December 31, 2006 (up 36%) Purchases of aviation assets of nearly $1 billion for FY 2006 IPO completed, proceeds of $156.4 million retained by the Company, and used primarily to pay down indebtedness Firm order with Airbus of 20 new A330-200 aircraft Launch of Chinese aircraft leasing joint venture

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Fourth Quarter Net Income Fourth Quarter Net Income

($ Million)

55% increase

• ver prior year

26.7 41.5 (58.7)

• 60
• 40
• 20

20 40 60 4Q 2005 4Q 2006* Net Income Excluding Charge for Share-based Compensation Charge for Share-based Compensation, Net of Tax

* 4Q 2006 results include AeroTurbine

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Full Year Net Income Full Year Net Income

83.4 156.3 (68.3) (100.0) (50.0) 0.0 50.0 100.0 150.0 200.0 Full Year 2005* Full Year 2006**

Net Income Excluding Charge for Share-based Compensation Charge for Share-based Compensation, Net of Tax

($ Million)

• 2005 results are 6 months ended June 30, 2005 for AerCap B.V. (predecessor company)

plus 6 months ended December 31, 2005 for AerCap N.V. (successor company) ** 2006 results include AeroTurbine from April 26 through December 31, 2006

88% increase

• ver prior year

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Earnings Per Share Earnings Per Share

$1.11 ($0.21) $1.07 $0.34 Total EPS 78.993 81.259 78.237 78.237 Average Shares Outstanding (Million) $0.34 4Q Full Year 4Q Full Year* $1.98 $0.51 $1.07 EPS Excluding Charge for Share-based Compensation

2005* 2006**

* 2005 results are for 6 months ended June 30, 2005 for AerCap B.V. (predecessor company) plus six months ended December 31, 2005 for AerCap N.V. (successor company) ** 2006 results include AeroTurbine from April 26 through December 31, 2006

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Total Assets and Number of Aircraft/Engines Total Assets and Number of Aircraft/Engines

Total Assets

Owned and on Balance Sheet $3,061 $3,923

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000

($ Million)

Number of Aircraft

• Owned

105 131

• On Order

15 99

• Under Contract/LOI
• 11
• Managed

121 103 Total Aircraft 241 344 Number of Engines (Owned or on LOI) 4 57

12/31/05 12/31/06

28% increase

• ver prior year

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Purchases of Aviation Assets Purchases of Aviation Assets

41 28 # of Aircraft Purchased $884.1 $483.6 Aircraft Related 89.1 39.2 Engines/Airframes $973.2 $522.8 Total Full Year 2006 4Q 2006

($ Million)

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Portfolio Management Metrics Portfolio Management Metrics

59 51 – Lease Renewals Average Term (Months) 2006 2005* Aircraft Lease Portfolio 99% 99% Utilization Rate ~17% ~15% Portfolio Yield** 103 69 – New Leases – as a % to 2006 Actual Lease Revenue 2007 Lease Revenue Already Contracted

• 2005 results are for 6 months ended June 30, 2005 for AerCap B.V. (predecessor company)

plus 6 months ended December 31, 2005 for AerCap N.V. (successor company) ** 2006 lease revenue (excluding maintenance) divided by average book value of flight equipment

~117%

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Revenue Breakdown Revenue Breakdown

$814.4 $211.6 Total Revenue* 65% 78% % Increase over 2005** 69.1 14.1 Management Fees, Interest Income and Other Revenue 301.4 64.7 Sales Revenue $443.9 $132.8 Lease Revenue Full Year 2006 4Q 2006 ($ Million)

* 2006 results include AeroTurbine from April 26 through December 31, 2006 ** 2005 results are for 6 months ended June 30, 2005 for AerCap B.V. (predecessor company) plus 6 months ended December 31, 2006 for AerCap N.V. (successor company)

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Sales Revenue Sales Revenue

4Q (4 aircraft) 2 Fokker 100s 2 B757s Full Year (19 aircraft) 13 Fokker 100s 4 A320s 2 B757s $301.4 $64.7 Total 37.7 15.4 Part-Out Sales 31.4 14.5 Engine Sales $232.3 $34.8 Aircraft Sales Full Year 2006 4Q 2006 Sales Optimizing Portfolio and Improving Mix, Quality and Diversification

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Cash / Access to Capital Cash / Access to Capital

($ Million)

$1,268 Available Lines of Credit at 12/31/06 $348 Operating Cash Flow in 2006 $243 Cash Balance at 12/31/06

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Debt/Financings Debt/Financings

($ Million)

$220

• AeroTurbine Revolving Facility (Amended)

$119

• AerVenture PDP Facility

$248

• Commercial Debt for Aircraft Purchases from GATX

Financings in 4Q 2006 (Total Amount of Facility) 6.8% 3.5 to 1 Average Cost of Debt in 2006* Debt/Equity Ratio at 12/31/06 $2,555 Total Debt at 12/31/06

* Interest expense divided by average debt balance

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Expenses & Productivity Expenses & Productivity

($ Million) 28%

• % Increase in Assets (2006 over 2005)

65%

• % Increase in Revenue (2006 over 2005)

19%

• % Increase in Expenses (2006 over 2005)

$245.7 $206.1 Expenses** 2006 2005*

*2005 results are for 6 months ended June 30, 2005 for AerCap B.V. (predecessor company) plus 6 months ended December 31, 2005 for AerCap N.V. (successor company) ** Includes depreciation/amortization, lease expenses, and SG&A expenses excluding charges for share-based compensation

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Taxes & Tax Rate Taxes & Tax Rate

$16.3 Taxes $103.7 Income Before Taxes 15.7% Tax Rate 2006 ($ Million)

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Adjusted EBITDA Adjusted EBITDA

2006** 2005* 39%

• % Increase over 2005

$452 $325 Adjusted EBITDA ($ million) ***

* 2005 results are for 6 months ended June 30, 2005 for AerCap B.V. (predecessor company) plus 6 months ended December 31, 2005 for AerCap N.V. (successor company) ** 2006 results include AeroTurbine from April 26 through December 31, 2006 *** Adjusted EBITDA excludes charges for share-based compensation

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2007 Outlook 2007 Outlook

Cash and available lines of credit allow for purchases in 2007 to be comparable to that achieved in 2006 2007 sales revenue as a % to total revenue expected to be higher than 2006 2007 cost of debt expected to be comparable to 2006 2007 tax rate expected to be lower than 2006 2007 ROE expected to be 20-25%

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2006 Highlights 2006 Highlights

Q4 net income was $41.5 million (excluding charge for share based compensation) FY net income $156.3 million (excluding charge for share based compensation) FY revenue was $814.4 million (up 65%) Flight equipment held for lease was $3.0 billion as of December 31, 2006 (up 36%) Purchases of aviation assets of nearly $1 billion for FY 2006 IPO completed, proceeds of $156.4 million retained by the Company, and used primarily to pay down indebtedness Firm order with Airbus of 20 new A330-200 aircraft Launch of Chinese aircraft leasing joint venture

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Notes Regarding Financial Information Presented in This Document

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The financial information presented in this press release is not audited. Following are definitions of certain non-GAAP measures used in this press release and a reconciliation of such measures to the most closely related GAAP measure: Net income excluding charges for share-based compensation. This measure is determined by adding charges for share- based compensation, net of related tax benefits to GAAP net income. The Company uses this measure to evaluate and communicate the results of its operations in periods where significant non-cash charges for share-based compensation have been recognized. The majority of these charges were recognized in connection with the Company’s public offering and related to a series of share-based awards granted in the twelve months prior to the public offering. The Company does not expect share-based charges of a similar magnitude to occur in comparable periods in the future. The Company believes this measure provides investors with a more meaningful view on the Company’s operational performance and allows investors to better understand the Company’s operational performance in relation to past and future reporting periods. Following is a reconciliation of net income excluding charges for share-based compensation to net income: Earnings per share excluding share-based compensation are determined by dividing the amount of net income excluding charges for share-based compensation by the average number of shares outstanding for that period. The average number

• f shares is based on a daily average.

Reconciliation of net income excluding charges for share-based compensation to net income ($ million) Fourth Quarter 2006 Full Year 2006 Net (loss)/income ($17.2) $88.0 Plus: Charges for share-based compensation, net of taxes 58.7 68.3 Equals: Net income excluding charges for share-based compensation $41.5 $156.3

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Adjusted EBITDA. Adjusted EBIDTA is determined by adding the amounts for charges relating to interest, depreciation and amortization, taxes and share-based compensation to the amount of net income. Adjusted EBITDA provides management with a useful measure of the Company’s operating performance because it assists management in comparing the Company’s operating performance in different periods without the impact of the Company’s capital structure (primarily interest charges on our outstanding debt), non-cash expenses related to our long-lived asset base (primarily depreciation and amortization) and non-cash expenses related to share-based compensation. Following is a reconciliation of Adjusted EBITDA to net income: The non-GAAP measures used in this press release are not intended to be considered in isolation or as a substitute for the GAAP measures to which they most closely relate. References to financial information for full year 2005 data include the six months ended June 30, 2005 for the predecessor company, AerCap B.V. (formerly known as debis AirFinance B.V.) and the six months ended December 31, 2005 for the successor company, AerCap Holdings N.V. This combined presentation is included because it is the way management analyzes the results of the Company and for the convenience of investors. The combination of these two periods is not in accordance with US GAAP and should be considered supplemental information only.

Reconciliation of Adjusted EBITDA to net income Full Year 2006 Full Year 2005 Net income $88.0 $83.4 Plus: Interest charge 166.2 114.6 Income taxes 16.3 14.7 Depreciation and amortization 102.4 112.3 Share-based compensation 78.6

• Equals: Adjusted EBITDA

$451.5 $325.0